By Heba Hashem

Mandatory or not, for some CSP developers, localizing project components and services is increasingly becoming a habit; a tried and tested route to lowering production and assembly costs, reducing tariffs, and shortening delivery times.

Commodity materials

California-based AREVA Solar, for example, has taken a well-thought-out approach to localizing its Compact Linear Fresnel Reflector (CLFR) technology; a strategy that begins from the earliest phases.

“In our Linear Fresnel, we design the technology to make sure that it doesn’t require any special skills to construct and fabricate,” says Jayesh Goyal, vice president of global sales at AREVA Solar, which has projects in the United States, Australia and India.

“What we focused on very much at first was that it needs to offer the lowest cost of electricity, so we concentrated on components that are easily available in most markets, commodity type of materials, so that it would be possible to create a local supply chain”.

In the Middle East and North Africa (MENA), Goyal believes they should be able to localize more than 95% of the solar field. “The reason we’re comfortable with giving such a high number, is that the components we use are basically flat glass and carbon steel tubes and these are easily available in the MENA region”.

Since construction work, which accounts for a large chunk of the cost, will often be local, an overall 70% localization could be achieved in AREVA’s CLFR solar plant, according to Goyal.

SolarReserve, the U.S. developers of the 110 MW Crescent Dunes, also believe they can source a high level of local content in their CSP towers within the MENA region – in excess of 80%. This, they aim to achieve, by localizing solar fields, among other components.

“In the heliostat field, a large percentage of the components, including glass and steel, is currently available locally, with the opportunity to establish on-site manufacturing or assembly,” Kevin Smith, CEO of SolarReserve, tells CSP Today.

The molten salt system including piping and tanks; power block; balance of plant; general contractor and full-wrap engineering, procurement and construction, also have the potential to be localized, adds Smith.

On-site fabrication

Unlike parabolic troughs, CSP towers and linear Fresnel collectors use flat glass, which is also curved but very slightly. That amount of curvature can be done mechanically on site and doesn’t need a specialized factory process, leading to reduced costs.

“Our manufacturing approach is not that we have a centralized facility somewhere else where we ship in components. Wherever our project site is, we set up a small mobile manufacturing unit, bring in the raw materials, steel and other components, and fabricate on site,” explains Goyal.

By doing so, they eliminate the high cost of trying to import heavy equipment from all over the place. “You get the standard equipment on site, you fabricate them right there, then you install them”.

Moreover, a large percentage of ‘local content’ can be achieved through operations and maintenance activity, civil work, steel structure, and storage tanks.

Paddy Padmanathan, president and CEO of Saudi IWPP developer and owner ACWA Power, told CSP Today last month, that there is definitely a scope for small local contractors to do the assembly task onsite, which is a “considerable amount of onsite activity in a warehouse-type environment – prior to the prefabricated frames being taken out to the field by lifting vehicles and erection.”

ACWA Power was notably awarded the 160 MW Ouarzazate CSP IPP in Morocco after delivering a tariff 28.8% lower than the one proposed by the second bidder. The reduced tariff according to the company was a result of localizing the project’s content – by nearly 42%.

Similarly, the construction of the 50 MW Bokpoort CSP plant, which is currently being developed by an ACWA Power-led consortium, will utilize more than 40% of scope procured locally in South Africa, despite being located in one of the most underdeveloped areas of the country – Groblershoop settlement in Northern Cape Province, almost 600 km south of Johannesburg.

In addition, the operation and maintenance of Bokpoort will be undertaken with the help of South African services provider Invest In Africa Energy (30%), as part of a consortium led by ACWA Power subsidiary NOMAC (70%).

Why localizing matters

Hiring local engineering and consultancy services, alongside local on-site construction, operations and maintenance can create thousands of new jobs – a critical element in emerging CSP markets, where growing the domestic supply chain and workforce represents a high priority.

As Goyal states: “In terms of the desire to have high local content, most countries, from the perspective of why they’re supporting solar, it’s not just because they want clean electricity, but they also want to promote the local industry and jobs”. According to AREVA Solar, construction of their CLFR allows for more than 60% local labour content.

Meanwhile, SolarReserve’s Crescent Dunes has so far generated at least 4,300 direct, indirect and induced jobs over the project’s life, with peak on-site employment of over 1,000 construction jobs, including more than 70 subcontractors just from the state of Nevada – where the project is located.

In addition, a huge portion of the project’s components was sourced locally, not just from within the U.S. but from the vicinity of the plant itself. “All 1.2 million square meters of glass were U.S. sourced, with assembly completed in an on-site manufacturing facility that employed local workers in a new industry,” Smith tells CSP Today.

“Virtually all of the 90,000 cubic meters of concrete required for the project was provided from a local supplier from a batch plant located in a small town just a few miles from where the project is located. All 2,000 tons of structural steel was U.S. sourced, as was the piping, cabling and valves.”

There’s no doubt that localizing CSP content can help ensure the timely completion of projects. After all, the delays in some of India’s CSP phase-one projects partly resulted from the long wait for imported heat-transfer fluid.

But until certain, more complex components such as turbines and CSP generators become widely available in emerging markets, the industry can learn valuable lessons from these kings of localization.

To comment on this article, please contact the author, Heba Hashem.